United Technologies (NYSE:UTX), parent company of Carrier, got a "good deal" with President-elect Donald Trump and there was no "quid pro quo", CEO Greg Hayes said in an interview with Jim Cramer.

"I was born at night but not last night," he declared. "I also know that about 10% of our revenue comes from the U.S. government. And I know that a better regulatory environment, a lower tax rate can eventually help UTC over the long run."

Workers at jet-engine maker Pratt & Whitney (NYSE:UTX) ratified a five-year contract Sunday, avoiding a potential labor dispute as the company tries to increase production of new engines for commercial airliners.

The deal was approved by members of two locals of the International Association of Machinists and Aerospace Workers, which represents about 2,600 workers at Pratt's engine plants in East Hartford and Middletown, Conn.

As part of a deal to keep jobs in the state, Carrier's parent company United Technologies (NYSE:UTX) has received $7M worth of tax breaks from the state of Indiana. In exchange, the firm will invest more than $16M in its Indianapolis plant.

Speaking at the factory, President-elect Donald Trump reiterated that American companies will not leave the country "without consequences," but promised to lower the U.S. business tax rate "from 35% to 15%" and do away with "many regulations."

The EU plans to boost its defense budget to its highest level in over a decade, setting up a €5B fund and sending a signal to Donald Trump that it intends to pay for its own security.

"This is not about an EU army, this is not about spending on the military instead of social security," European Commission Vice President Jyrki Katainen said. "We face multiplying threats and we must act."

Donald Trump has called for eliminating the sequester on defense spending and initiating a military buildup, boosting troop levels and the number of ships and aircraft.

He seeks to fully offset the cost through "common sense reforms that eliminate government waste and budget gimmicks" and additional payments from countries where the U.S. has military bases, including Germany, Saudi Arabia and Japan.

Lockheed Martin (NYSE:LMT) has concluded negotiations with the U.S. Defense Department on a contract for 57 F-35 fighter jets after 14 months of negotiations on the $6.1B-plus deal.

Reuters reports the contract will provide profit margin certainty to LMT and its partners - including Northrop Grumman (NYSE:NOC), Pratt & Whitney (NYSE:UTX) and BAE Systems (OTCPK:BAESF, OTCPK:BAESY) - who have been producing the jet under a placeholder agreement.

However, LMT says the contract was "not a mutually agreed upon contract, it was a unilateral contract action, which obligates us to perform under standard terms and conditions, and previously agreed-to items."

Another production contract, a 94-plane deal, is said to remain under negotiation.

Hawkers of civil and military aircraft - and the money to finance them - will try to drum up new business at aerospace expos this week, conscious their high-risk industry is approaching a turning point.

China's biggest aviation event - Airshow China - starts in Zhuhai tomorrow. A defense trade show will also take place in Jakarta and an air finance conference in Hong Kong, as well as the annual U.S. business jet jamboree in Orlando, Florida.

United Technologies (UTX-0.6%) is downgraded to Neutral from Buy with a $109 price target at Citigroup, which foresees challenges ahead for UTX and expects management to pull back 2020 targets at the March Investor Day.

The firm also thinks 2017 consensus expectations for UTX look too high and manufacturing issues on the new geared turbofan engine likely create uncertainty over the size of potential penalties and impact on longer-term market share.